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Hollywood, Tech Accord Incites Criticism
by Drew Clark
Hollywood and major technology companies agreed last week on the beginnings of an approach to keep digital television broadcasts from being pirated over the Internet. Although the accord could signal détente in the escalating war of words between southern and northern California's key industries, consumer and "fair use" advocates are just warming to battle -- and they do not like what they see in the agreement.
Even though details of the deal were not finalized until Friday, executives at News Corp., AOL Time Warner, and Panasonic mentioned the proposal at a Thursday hearing of the House Energy and Commerce Telecommunications and the Internet Subcommittee. The agreement between three groups of companies covers the "broadcast flag," a technology to be embedded in digital television broadcasts designed to stop the unauthorized redistribution of those programs. It would not address two other Hollywood priorities: clamping down on peer-to-peer (P2P) piracy via the Internet and stopping consumers from making digital copies of analog broadcasts.
By proposing a way to implement the broadcast flag, the least controversial of Hollywood's three demands, the agreement could eliminate what many see as a key stumbling block inhibiting the rollout of digital television. But that also means Congress could be asked to take action in as soon as a few weeks. The next major step comes when the three groups that crafted the proposal present it to the Broadcast Protection Discussion Group (BPDG) on May 17.
A Consensus Without Consensus
The Motion Picture Association of America (MPAA), the "5C" consortium of consumer electronics manufacturers and a computer-industry group including Hewlett-Packard, Compaq, Intel, NEC and Microsoft drafted the agreement. Under the proposal, the broadcast flag would be embedded in transmissions to act as a trigger to prohibit copying from a digital TV receiver to a digital videocassette recorder unless certain specific conditions are met. Those conditions still must be itemized in a section of the agreement dubbed "Table A".
Any consensus behind the proposal was marred at the Thursday subcommittee hearing by the very public dissent of Philips Consumer Electronics, a company that is not a part of the 5C group of Hitachi, Intel, Matsushita, Sony and Toshiba. "We, along with a growing number of participants, are deeply concerned about the direction that the group is taking with respect to what happens after the broadcast flag is identified, and how digital would be constrained inside the home," said Larry Blanford, CEO of Philips Consumer Electronics, which on Friday offered its counter-proposal for Table A.
He said he is concerned that the accord would undermine consumers' rights by making it impossible for the owners of 35 million digital-videodisc players to play TV programs they already have recorded.
"The BPDG has been taken over by a small group of companies that are pressing a particular approach that would affect all retransmission of content inside the home," said Blanford. "This proposal tramples upon the fair-use rights of the consumer and introduces unnecessary levels of complexity and costs in consumer devices."
The Electronic Frontier Foundation, which has been closely following the progress of the BPDG, also is unhappy with the preliminary results. "The 5C/MPAA proposal makes no bones about the group's actual raison d'etre: to control and curtail what you do with the devices you own and the video signals you buy," the EFF's Cory Doctorow said.
A Temporary Problem?
But Paul Liao, chief technology official for the American operations of Panasonic/Matsushita Electronic and a spokesman for the 5C group, countered at the hearing that consumers still could make as many analog copies of a digital TV broadcast as they wanted. While acknowledging that the proposal could cause inconveniences for the few consumers who already have an all-digital home network, he called the impediments on digital copying temporary, until new DVDs that meet the specifications are manufactured and sold.
"It is a temporary problem, but sometimes that is the price you need to pay to move forward," Liao said. Although slightly degraded from digital copies, such analog recordings "look as good as what you see" on existing analog television sets.
The issue has place heightened scrutiny on the BPDG, a highly technical subgroup of the Copy Protection Technical Working Group (CPTWG), a committee of some of Hollywood's and Silicon Valley's top engineers. CPTWG has been the two industries' focal point for collaboration on technologies to manage digital rights since the creation of the scheme for encrypting DVDs in 1996.
They also have designed systems to impede unauthorized access to and copying of cable and satellite broadcasts of digital content, and created the BPDG in response to demands from companies like News Corp. and Disney.
Part of the drive for standards that would copy-protect digital TV stems from concern that the absence of such standards is keeping the studios and networks from releasing digital content. That could lend considerable momentum to the accord, even if Philips objects.
"There is a huge anxiety in the Congress of the digital TV transition," said House Energy and Commerce Committee Chairman W.J. (Billy) Tauzin, R-La. "Anything that broadly supports [that transition] will be a feast for the members" of Congress, he said, adding that he would move legislation even if there were "outliers" in the technology and electronics communities.
Two Takes On The Hollings Bill
Yet at the same time, almost all of the House Energy and Commerce subcommittee members weighing into the debate over digital rights management and digital TV on Thursday were extremely skeptical of the bill authored by Senate Commerce Committee Chairman Ernest (Fritz) Hollings, D-S.C. That measure, S. 2048, would require computer makers and software designers to build government-mandated copyright-protection technologies into every digital device or risk criminal penalties.
Critics of that approach suggest that industry cooperation is far preferable to a government technology mandate. One telling moment in the hearing came when Rep. Anna Eshoo, D-Calif., asked, "Is there anyone on the panel that agrees with the Hollings approach?"
There was complete silence from the panelists, including AOL Time Warner CEO-elect Richard Parsons, Blanford and Liao. But then Chairman Fred Upton, R-Mich., said Peter Chernin, the president of News Corp. who had joined the hearing via teleconference, had logged off. Chernin and Disney CEO Michael Eisner aggressively supported that approach when they testified before Hollings' committee in February.
"Dead, dead, dead," one technology industry insider said of Hollings' bill after the hearing ended. But a Senate Commerce Committee aide said Hollings is quite pleased with what his legislation already has accomplished. "Last year Warner Brothers came and said, 'We don't think there is a solution for broadcast,'" the committee aide recounted. "They are solving that problem.
"These [technology industry] guys said to us, 'If you have a hearing, you'll stifle our ability to negotiate.' Then we had a hearing. Then they said, 'If you have a bill, you'll kill negotiation.' Hollings has kept the pressure on, and we feel we are seeing results."
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